comparing real estate business practices - usa and greece

Graduate School of Real EstateGraduate School of Real EstateJOHN HOPKINS UNIVERSITYJOHN HOPKINS UNIVERSITY

““Comparing Real Estate Business Comparing Real Estate Business PracticesPractices

In the U.S.A. and GREECE”In the U.S.A. and GREECE”

Presented by:Presented by:Angela C. EliopoulosAngela C. Eliopoulos ABR CIPS GRIABR CIPS GRICertified International Property SpecialistCertified International Property SpecialistLicensed in DC, MD, VALicensed in DC, MD, VAGLOBAL OWNER Property ConsultantsGLOBAL OWNER Property ConsultantsU.S.A. – EUROPEU.S.A. – [email protected]@globalowner.comWWW.GLOBALOWNER.COMWWW.GLOBALOWNER.COM

Global Owner Global Owner © 2005© 2005

Nine topics:Nine topics:

1.1. Code of EthicsCode of Ethics2.2. LicensingLicensing3.3. Foreign OwnershipForeign Ownership4.4. Land Registration SystemLand Registration System5.5. DisputesDisputes6.6. ServicesServices7.7. ReferralsReferrals8.8. Marketing Marketing 9.9. CommissionCommission

Global Owner © 2005Global Owner © 2005

CODE OF ETHICSCODE OF ETHICS

U.S.A.U.S.A.

In 1913 NAR adopted In 1913 NAR adopted “Rules of Contract”. “Rules of Contract”.

Today: NAR establishes Today: NAR establishes public & professional public & professional standards. Enforcement standards. Enforcement is the responsibility of the is the responsibility of the local Boards. There are local Boards. There are 70 standards of practice 70 standards of practice that interpret various that interpret various articles in the Code of articles in the Code of Ethics.Ethics.

GREECEGREECE

No statutory code of No statutory code of ethics. The Hellenic ethics. The Hellenic Association of Association of Realtors(the smaller of Realtors(the smaller of the two real estate the two real estate organizations in Greece) organizations in Greece) has recently established has recently established its own rules for its own rules for members. No strict members. No strict enforcement followed.enforcement followed.


LICENSINGLICENSING

U.S.A.U.S.A.

Every US state offers license to practice real estate. Every US state offers license to practice real estate. Agents should be 18 years of age, have a High School Agents should be 18 years of age, have a High School Diploma and have completed an average of 60 hours Diploma and have completed an average of 60 hours classroom instruction. Written exam required.classroom instruction. Written exam required.

For license renewal, continuing education courses are For license renewal, continuing education courses are required every 1-2 years. Large number of agents has required every 1-2 years. Large number of agents has college degrees and there are over 1,000 junior colleges college degrees and there are over 1,000 junior colleges and universities offering classes and degrees in Real and universities offering classes and degrees in Real Estate both undergraduate and graduate. Specialization Estate both undergraduate and graduate. Specialization is earned by taking classes on a specific designation.is earned by taking classes on a specific designation.


LICENSING cont.LICENSING cont.

GREECEGREECE

No real estate education required for No real estate education required for agents/brokers. Need to have a High agents/brokers. Need to have a High School Diploma. No regional restrictions School Diploma. No regional restrictions within the country. Unregulated within the country. Unregulated profession.profession.



FOREIGN OWNERSHIPFOREIGN OWNERSHIP

U.S.A.U.S.A.

Over $50 billion in foreign Over $50 billion in foreign investments in the US: investments in the US: High return, stable High return, stable economyeconomy

GREECEGREECE

All EU Citizens have All EU Citizens have equal rights to buy in equal rights to buy in Greece. Non US Citizens Greece. Non US Citizens need special permission. need special permission. An additional procedure An additional procedure is followed for the is followed for the purchasing of property purchasing of property close to the Greek close to the Greek borders. Authorities do borders. Authorities do not grant this to non EU not grant this to non EU Citizens.Citizens.


4. LAND REGISTRATION 4. LAND REGISTRATION SYSTEMSYSTEM

U.S.A.U.S.A.

The Deed is the instrument of property The Deed is the instrument of property transfer. Sales Contract is just an “offer” transfer. Sales Contract is just an “offer” until all parties have agreed. Written until all parties have agreed. Written evidence by Statute of Frauds needed to evidence by Statute of Frauds needed to validate the transfer. Title Attorney validate the transfer. Title Attorney facilitates settlement. facilitates settlement.


LAND REGISTRATION SYSTEMLAND REGISTRATION SYSTEM U.S.A cont’dU.S.A cont’d

8 professionals 8 professionals might might bebe involved in a involved in a transaction:transaction:

LenderLender AttorneyAttorney AppraiserAppraiser InspectorInspector Notary PublicNotary Public Title companyTitle company AccountantAccountant SurveyorSurveyor


LAND REGISTRATION SYSTEM cont.LAND REGISTRATION SYSTEM cont.

GREECEGREECE

The Transaction Deed is signed by both Buyer The Transaction Deed is signed by both Buyer and Seller. Professionals needed:and Seller. Professionals needed:

Notary PublicNotary Public Buyer’s LawyerBuyer’s Lawyer Seller’s LawyerSeller’s Lawyer Buyer and Seller need to provide valid Buyer and Seller need to provide valid

passports, obtain a VAT Registration number passports, obtain a VAT Registration number and Seller should have a tax certificate of No and Seller should have a tax certificate of No Debts.Debts.


DISPUTESDISPUTES

U.S.A.U.S.A.

Arbitration & Arbitration & Mediation are offered Mediation are offered as alternatives to as alternatives to Litigation procedures. Litigation procedures. Error & Omissions Error & Omissions Insurance is Insurance is necessary for all real necessary for all real estate practitionersestate practitioners

GREECEGREECE

No mechanism other No mechanism other than through the than through the Legal System to solve Legal System to solve remuneration remuneration disputes. disputes.


SERVICESSERVICES

U.S.A.U.S.A.

In most states real estate agents In most states real estate agents represent either the Buyer or the Seller. In represent either the Buyer or the Seller. In the case of dual representation, it has to the case of dual representation, it has to be disclosed to both parties. Buyer’s be disclosed to both parties. Buyer’s Agency is becoming popular. Agents offer Agency is becoming popular. Agents offer full services from financing to closing.full services from financing to closing.


SERVICES cont.SERVICES cont.

GREECEGREECE

Dual representation is most common. Dual representation is most common. The Attorneys and Notary Public performs The Attorneys and Notary Public performs most services after the signing of the most services after the signing of the contract.contract.


REFERRALSREFERRALS

U.S.A.U.S.A.

In most states referral In most states referral fees are only paid to fees are only paid to licensed licensed salespersons. Other salespersons. Other professionals involved professionals involved in the transaction are in the transaction are not allowed to receive not allowed to receive any form of payment.any form of payment.

GREECEGREECE

No system in place. No system in place. It’s wise to create It’s wise to create personal contacts personal contacts prior to referring prior to referring clients.clients.


MARKETINGMARKETING

U.S.A.U.S.A.

Advertising in the media, direct mailing, e-mails Advertising in the media, direct mailing, e-mails and other forms of marketing.and other forms of marketing.

A cooperative agreement among Brokers to A cooperative agreement among Brokers to share listings and compensate each other is share listings and compensate each other is available in most states.available in most states.

MLS (Multiple Listing Services). User name and MLS (Multiple Listing Services). User name and password necessary. password necessary. Agents should enter the Agents should enter the property on MLS within 48 hours of signing the property on MLS within 48 hours of signing the listing agreement with the Seller. listing agreement with the Seller.


MARKETING cont.MARKETING cont.

GREECEGREECE

Traditional advertising and marketing through Traditional advertising and marketing through newspapers and property magazines is being newspapers and property magazines is being used. Direct mailers are just starting to be used used. Direct mailers are just starting to be used as well as promotions through the internet and as well as promotions through the internet and e-mails. Small group of brokers have started e-mails. Small group of brokers have started forming their own MLS to be used only by their forming their own MLS to be used only by their own members.own members.


COMMISSIONCOMMISSION

U.S.A.U.S.A.

In most cases, the Seller In most cases, the Seller pays the commission to pays the commission to the brokerage firm that is the brokerage firm that is then split between the then split between the Buyer’s representative Buyer’s representative and the Listing agent. and the Listing agent. The total fee is between The total fee is between 5%-7% shared between 5%-7% shared between the two sides.the two sides.

GREECEGREECE

Both the Buyer and the Both the Buyer and the Seller pay from 1% to 2% Seller pay from 1% to 2% each. Each side charges each. Each side charges his/her own client.his/her own client.


Lesson Learned…Lesson Learned…

Non cultural obstaclesNon cultural obstacles (like legal (like legal structures, government bureaucracies, structures, government bureaucracies, political instabilities) are very important political instabilities) are very important but,but,

Success hinges on personal relationships Success hinges on personal relationships and deep and deep understanding of the cultureunderstanding of the culture of those sitting on the other side of the of those sitting on the other side of the table!table!


Our mission is to provide International Real Our mission is to provide International Real Estate Consultancy that allows our clients Estate Consultancy that allows our clients to to seamlesslyseamlessly and efficiently transact and efficiently transact across borders for business, lifestyle across borders for business, lifestyle

and investmentand investment..


comparing real estate business practices - usa and greece

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